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Boulder companies react to news that FDA to look at milk label regulations

By Madeline St. Amour

Staff Writer

Posted:
08/11/2018 11:00:00 AM MDT

Tracy Eliasson adds two cartons of almond milk to her cart in Alfalfa's Market while shopping earlier this month in Boulder. The U.S. Food and Drug Administration is considering cracking down on plant-based beverages labeled as milk. (Paul Aiken / Staff Photographer DAILY CAMERA)

Local plant-based food companies say their businesses could be affected by potential changes in Food and Drug Administration enforcement of labeling regulations.

FDA Commissioner Scott Gottlieb said the agency plans to look more closely at enforcement standards for milk labeling, which he first mentioned at the July 17 Politico Pro Summit that hosted conversations with policy makers from the federal government and agencies.

If the FDA decides to amp up enforcement on milk labels, which state that milk is the "lacteal secretion" that comes from milking a cow, that could hurt Jordan Marinovich's startup.

Cows poke their heads through the bars on their pen to eat on land leased by Longmont Dairy in Loveland. The U.S. Food and Drug Administration is considering cracking down on plant-based beverages labeled as milk. (Jenny Sparks / Loveland Reporter-Herald)

Marinovich, along with Destiny Swinney and Jamie Rouselle, started Boulder Sun, LLC in September 2017. The company uses sunflower seeds to make milk through a process that's similar to how nut milk is made. So far, it's the only kernel-based sunflower seed milk on the market, according to Marinovich.

Like other plant-based milks, the Boulder company's "Sun Milk" wouldn't make the cut for the FDA's definition.

About time

But if you ask the National Milk Producers Federation, "it's about darn time that the FDA does what it's supposed to do."

Chris Galen, senior vice president of communications for the federation, said that the competition from "imitation products" is not the problem, but that competition means there should be rules that need to be followed.

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"The reason why these companies really desperately want to continue using the term milk is because it comes with a strong nutritional connotation to it," Galen said. Some consumers may assume that the drinks, placed next to each other in grocery aisles, would have similar nutritional value, Galen said, using the metaphor of Coke versus Pepsi products.

But the nutritional value of nut milks can vary greatly from product to product, and even more so from cow's milk.

Galen also said that if the FDA were to change enforcement standards, the impact would not be that great on companies that are already selling products abroad without the label of milk.

Other countries, such as Canada, also define milk as coming from a cow.

"The only difference is that the U.S. hasn't been enforcing these regulations," Galen said.

Katie Hermann, co-owner of Longmont Dairy Farm, Inc., is also supportive of the move and said she agrees with the "more traditional" definition of milk.

However, Hermann also said she supports plant-based drinks, some of which her business carries, even if she doesn't think that the label "milk" fits them.

"I believe in transparency in labeling so that consumers trust what they are buying," she said in an emailed statement. The use of the word milk can affect how products are perceived, she said, and mislead consumers about a product's nutritional value. "This FDA decision will help eliminate that confusion and lead to more accurate nutritional choices."

But, she added, "at the end of the day, I'm not going to lose sleep if they're still called milk."

Adequate nutrition

Gottlieb and the FDA are looking at the how the differences between plant-based milk and traditional cow's milk could relate to "potential public health consequences," according to a statement the agency released July 26.

The statement cites case reports that showed parents who gave rice-based drinks to toddlers less than 2 years old resulted in the disease kwashiorkor, a form of severe protein malnutrition. It also notes a report of a 16-month-old who developed rickets, which is caused by a vitamin D deficiency, after parents used a rice-based milk instead of cow's milk.

"Because these dairy alternative products are often popularly referred to as 'milk,' we intend to look at whether parents may erroneously assume that plant-based beverages' nutritional contents are similar to those of cow's milk," the statement reads.

Marinovich is skeptical of these claims, he said, because they only cite case reports and not larger studies or regression analyses. To use these "anecdotes" to affect a whole market, he said, "is an overreach, in my opinion."

Longmont Dairy salesperson Doug Furstenau loads samples into his car at the start of his shift Thursday. The U.S. Food and Drug Administration is considering cracking down on plant-based beverages labeled as milk. (Lewis Geyer / Staff Photographer)

While it's true that cow's milk has more complete proteins than its alternatives, said Lisa Mink, a registered dietitian and certified diabetes educator at Longmont United Hospital, it's also true that children can be raised on plant-based milks in a healthy way.

"(Parents) need to make sure that they're being supplemented with other foods to ensure that they're getting adequate nutrition," Mink said.

The examples provided by the FDA, she said, appear to her as examples of parents who "didn't educate themselves enough and do enough research" on the nutritional differences of the products.

Adhering to different diets and choosing different products is a personal choice, Mink said, but she added that, as a dietitian, she's "a firm believer that if people want to try different products, they need to do their research."

Potential impact

If the FDA were to bar companies from labeling plant-based drinks as "milk," Marinovich said it could have a financial impact on his company.

"We could have stockpiles of inventory that are useless and become a liability, not an asset," he said, noting that product packaging would be outdated.

As a new company, Marinovich said he's also now facing additional questions from investors about how the labeling issue could affect Boulder Sun.

"Risk, as you know, is not good in business," he said, and this threat of a large change in marketing "just adds another risk."

Marinovich is also waiting on a trademark for the use of "Sun Milk" for the brand name. If it gets approved, but the FDA changes its enforcement policy, he'll be left with the questions of, "Who do I go with? Do I have to change?"

"These are questions that need to be answered, and I don't think that it was very well thought out before literally throwing a wrench in the machine," he said.

However, Good Karma Foods, a Boulder-based company that makes milk products and yogurt from flaxseeds, is optimistic that the review could update the current regulation language.

"We welcome the FDA's efforts to review the dairy milk standards of identity," CEO Doug Radi said in a statement.

According to Radi, nearly 40 percent of U.S. households consume plant-based milks, so they support "the movement to modernize the standards of identity to reflect the current market and consumer behavior."

Simon is the executive director of the Plant Based Foods Association, a national organization that promotes the plant-based foods industry. Data that the association commissioned from Nielsen shows that, in 2018, retail sales for plant-based foods overall grew by 20 percent, and sales for plant-based milks grew by 9 percent.

In contrast, retail sales for cow's milk declined by 6 percent in 2018.

"The consumer has already spoken," Simon said.

However, if the standards for enforcement were to change, it could potentially place extra costs on companies and confuse consumers.

Plant-based milks have used that label for decades, Simon said, and changing that label and their supermarket placement could confuse people and stifle the industry's growth.

"It seems like it would be a step back instead of a step forward," she said. "(...) It's ridiculous. This is the way it's been."

Beyond milk

Aside from the financial implications, Marinovich said he worries about what other plant-based products could be impacted.

Butter, for instance, is defined as milk and cream, he said. Would peanut butter have to change its labeling?

And could plant-based meat substitutes, like Beyond Meat, face enforcement in the future, as well?

According to Simon, it's a possibility.

"We've already heard some rumblings from the meat industry, similar to the dairy industry," she said. "They seem to be taking a page from the dairy lobby on their complaints."

While these products may use the words "milk," "meat" or "butter," they also use qualifiers and modifiers, Simon said, so no one is being tricked.

Simon added that the association is sympathetic to the dairy industry, especially small farmers, and the economic challenges they are facing. But, she said, the solutions are more complicated than changing a label on other products.

If the FDA decides to enforce the current milk regulations, Simon said the agency will be sued. It's possible the association would initiate the lawsuit, she said, though she noted its possible consumers or business members of the association could file it.

First amendment law protects brands' ability to label food, she said, which makes it "pretty easy to predict the outcome in court."

Simon believes that Gottlieb, the FDA commissioner, is under "tremendous political pressure" from the milk industry, which is reflected in the case reports he cited in his statement.

"There's no question that their only options are compromise ... or we sue them in court," she said.

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